Peak oil - Apr 23

Missing DOE report on peak oil and oil shale reappears original: "Oil shale activities"US Department of Energy It is generally agreed that worldwide petroleum supply will eventually reach its productive limit, peak, and begin a long term decline. What should the United States do to prepare for this event? An objective look at the alternatives points to the Nation's untapped oil shale as a strategically located, long-term source of reliable, affordable, and secure oil.

The vast extent of U.S. oil shale resources, amounting to more than 2 trillion barrels, has been known for a century. In 1912, the President, by Executive Order, established the Naval Petroleum and Oil Shale Reserves. This office has overseen the U.S. strategic interests in oil shale since that time. The huge resource base has stimulated several prior commercial attempts to produce oil from oil shale, but these attempts have failed primarily because of the historically modest cost of petroleum with which it competed. With the expected future decline in petroleum production, historic market forces are poised to change and this change will improve the economic viability of oil shale.

It has been nearly two decades since meaningful federal oil shale policy initiatives were undertaken. In that time technology has advanced, global economic, political, and market conditions have changed, and the regulatory landscape has matured. As America considers its homeland security posture, including its desired access to diverse, secure and abundant sources of liquid fuels, it is both necessary and prudent to reconsider the potential of oil shale in the nation's energy and natural resource portfolio. (March 2004)Go to the original article for links to several reports and resources. Reader JB reports:

Simmons: global energy war could happen over oilKarl Hanlon, The Irish Times A global energy war could become a reality unless governments and people make painful adjustments to cope with dwindling oil reserves, an international energy expert has predicted.

Matthew Simmons, a former energy adviser to US president George Bush, warned that global oil production was now close to "peak" level and would decline irreversibly.

Mr Simmons who is chairman of Simmons & Co - a US-based investment bank that specialises in the energy industry - was speaking at the University of Limerick. As crude prices hit a record high of $74 a barrel yesterday, Mr Simmons claimed that oil was still selling at a price far below its true value.

In an address entitled "Will 'Twilight in the Desert' mean Economic Eclipse for Europe", Mr Simmons dismissed suggestions that oil prices were rising too fast and said he believed the real price of oil should peak at $180 a barrel in the next decade.

...Mr Simmons suggested that a global energy conference would be a major first step in addressing dwindling oil supplies allied to increased demand. "Unless we want to have a terrible vicious energy war we better work on a concerted way to actually start using less oil, particularly in the way we transport people and goods," he said.

Mr Simmons outlined a series of conservational approaches and "painful adjustments" which he said needed to be implemented to avoid a global energy war.

He advocated a major shift in the way goods are transported in the marketplace from a dependence on road infrastructure to rail and water transport. (21 April 2006)The original article requires a subscription.

The "Hot" War: in business at the front lineJohn Laumer, Triple Pundit The “Cold War” pitted developed nations against each other for a half-century, sustained by a small number of corporate surrogates who designed and supplied defenses. The "Hot War" era now emerging is driven by serious and immediate resource shortages and climate change at a global scale: things indivdual governments are very poorly positioned to control. The “Hot War” era will pit large corporations and small businesses against each other with great intensity of competition. As in recent times, occasionally corporations will band together to use national governments as surrogates in this struggle, advocating policies scripted by a Cold War era progeny called the “Think Tank”.

Note: since the Red Scare passed, several Think Tanks have been reincarnated as “anti-Greens.” Lately, the term “green baiting” even entered our lexicon (try Google if you doubt it). But this ideological push back is mere noise compared to the economically more significant struggles to come between corporations.

Enterprises that have particularly energy intensive business models like shippers, utilities, chlorine makers, and aluminum smelters, will struggle especially hard to access low priced raw materials, fuel, and electricity. Some will demand government guarantee of access below market price "in the interest of national security". Some will outsource their way out of high energy or raw material costs: an unsustainable tactic in a global economy. Others will innovate around more efficient technologies and will seek collaboration with others in their supply chain to be less resource intensive. The conflicting approaches send a mixed message to governments. And it will worsen as shortages happen more frequently. Pragmatic solutions will be few and far between until back room advocacy is no longer available to the highest bidder, and greener business models are allowed to be tested in the free market.. (19 April 2006)

Are commodity prices threatening energy investments?Cyril Widdershoven, Resource Investor Current high crude oil prices, combined with an exponential increase of other commodity prices, has brought unexpected windfalls to the oil and mineral producing countries around the world.

The future looks bright [for oil and gas producers]. But some oil analysts are indicating, however, clouds are emerging on the horizon. More and more oil producers, including international private oil and gas companies are warning that continued high energy prices are having an effect on commodity prices, which threatens to reduce this prosperous trend.

...In a statement made to Dow Jones, the former chairman of Libya's National Oil Corporation (NOC), Abdallah Al-Badri, stated that soaring commodity and raw material prices could stifle much-needed development.

Instead of having increased the potential for economic development and possible diversification, several OPEC countries are complaining that most of their infrastructure, power, gas and even oil projects are to be delayed. Heightened oil and commodity prices are blamed as constraining investment projects. The surge in metal and other commodity prices has negatively influenced the overall cost price of most energy projects around the world.

...The official went on to note that, at current levels, oil majors may[]be forced to put on hold oil exploration and development work.

...Abdullah Al Attiyah, Qatar’s Minister of Oil, stated in Paris that "our costs have tripled from two years ago, due to high (commodity) prices. And it’s not just that, it is also contractors who have tripled their prices."

...According to leading OPEC countries, it has become impossible to estimate what new projects will cost as long as commodity prices continue their current price rally. (20 April 2006)

Peak tiresJerome a Paris, European Tribune soon you'll be hoping for the peak in "peak diaries"...

HOUSTON, April 19 -- The worldwide thirst for stuff from the ground -- materials as diverse as copper and coal, gold and oil -- has set off a stunning boom in just about every commodity market. But there is one item that lately has dealers in the global mining industry really scrambling: the supersize tire.

They are used prominently everywhere from the Canadian tar sands to open-air coal mines in the United States and China, but lately they have become almost as precious as gold and silver: prices have quadrupled for some of them in the last year to more than $40,000 a tire.

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